PIERRE, S.D. (Feb. 25, 2020) – Today, a South Dakota Senate committee passed a bill that would reform asset forfeiture laws to prohibit the state from taking property without a criminal conviction in most cases and withdraw the state from a federal program that allows police to circumvent more strict state forfeiture laws by passing cases off to the federal government.

Sen. Arthur Rusch (R-Vermillion) and Rep. Jess Olson (R-Rapid City) introduced Senate Bill 172 (SB172) on Feb. 6. The legislation would effectively end civil asset forfeiture in South Dakota and replace it with a criminal forfeiture process. Under the proposed law, prosecutors could not proceed with asset forfeiture proceedings unless the criminal prosecution that provides the basis for the forfeiture results in a conviction and the state establishes by clear and convincing evidence that the property constitutes, or is derived directly from, proceeds of the underlying offense for which the person was convicted; or if the property was used in any manner or part, to commit, or to facilitate the commission of the offense for which the person was convicted.

The Senate Judiciary Committee passed SB172 by a 5-2 vote.

The Institute for Justice calls South Dakota’s asset forfeiture laws “some of the worst in the country.” In order to forfeit property, law enforcement only has to tie it to a crime by a preponderance of the evidence. Under the current law, people in South Dakota can have the property permanently seized without even being charged with a crime. There is also a strong “policing for profit” incentive in the state, with law enforcement keeping up to 100 percent of forfeiture proceeds.

The Judiciary Committee amended SB172 to address the policing for-profit motive. Under the proposed law, state and local law enforcement agencies could be reimbursed for expenses incurred prosecuting the case with forfeiture funds, but any additional money would go to the state school system.

The Judiciary Committee also amended the bill to close a loophole that allows state and local police to circumvent more strict state forfeiture laws by simply passing cases off to the feds.

This is particularly important in light of a 2017 policy directive issued by then-Attorney General Jeff Sessions for the Department of Justice (DOJ).


A federal program known as “Equitable Sharing” allows prosecutors to bypass more stringent state asset forfeiture laws by passing cases off to the federal government through a process known as adoption. The DOJ directive reiterates full support for the equitable sharing program, directs federal law enforcement agencies to aggressively utilize it, and sets the stage to expand it in the future.

Law enforcement agencies can circumvent more strict state forfeiture laws by claiming cases are federal in nature. Under these arrangements, state officials simply hand cases over to a federal agency, participate in the case, and then receive up to 80 percent of the proceeds. However, when states merely withdraw from participation, the federal directive loses its impact.

Until recently, California faced this situation. The state has some of the strongest state-level restrictions on civil asset forfeiture in the country, but state and local police were circumventing the state process by passing cases to the feds. According to a report by the Institute for Justice, Policing for Profit, California ranked as the worst offender of all states in the country between 2000 and 2013. In other words, California law enforcement was passing off a lot of cases to the feds and collecting the loot. The state closed the loophole in 2016.

SB172 closes this loophole with a complete prohibition on passing cases to federal authorities.

“A local or state law enforcement agency may not refer, transfer, or otherwise relinquish possession of property seized under state law to a federal agency by way of adoption of the seized property or other means by the federal agency for the purpose of the property’s forfeiture under the federal Controlled Substances Act, Public Law 91-513, or other federal law.”

As the Tenth Amendment Center previously reported the federal government inserted itself into the asset forfeiture debate in California. The feds clearly want the policy to continue.


We can only guess. But perhaps the feds recognize paying state and local police agencies directly in cash for handling their enforcement would reveal their weakness. After all, the federal government would find it nearly impossible to prosecute its unconstitutional “War on Drugs” without state and local assistance. Asset forfeiture “equitable sharing” provides a pipeline the feds use to incentivize state and local police to serve as de facto arms of the federal government by funneling billions of dollars into their budgets.


SB172 will go to the Senate floor for further consideration.

Mike Maharrey